Industrial Revolution 4.0: Digital Transformation in Factories and Production

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The industrial revolution 4.0 has brought significant digital transformation in factories and production. Technological developments such as the Internet of Things (IoT), big data, and artificial intelligence have changed the way work and production processes in various industries. 

With the various changes occurring in the world today, everything is developing rapidly, including the industrial sector. Recently, the word industry 4.0 has often been mentioned by many people. But what is actually meant by industry 4.0?

This term was first heard at the Hannover Fair on April 4 to 8 2011, which was used by the German government to advance the existing industrial sector to the next level with the help of technology. The industrial revolution 4.0 or also commonly known as "cyber physical system" itself is a phenomenon where collaboration occurs between cyber technology and automation technology.

This revolution itself brought many changes in various sectors. As initially many companies required large amounts of labor, now this can be replaced by the use of technological machines. The following is a further explanation regarding industry 4.0 which is currently occurring in people's lives.

This article will explain in more detail about the industrial revolution 4.0 and how digital transformation has affected factories and production.

What is Industry 4.0 in simple terms?

Industrial Revolution 4.0: Digital Transformation in Factories and Production
Industrial Revolution 4.0

Industrial revolution 4.0 is the latest stage of industrial development. This is an era where digital and physical technologies are integrated to create more efficient, intelligent and connected production systems. This revolution involves the use of technologies such as IoT, big data, artificial intelligence, robotics, and others.

Industrial Revolution 4.0 or what is often called cyber physical system is a revolution that focuses on automation and collaboration between saber technology. The 4.0 revolution itself emerged in the 21st century with the main characteristic being the integration of information and communication technology into the industrial sector.

With the emergence of this revolution, many things have changed in various sectors. Where initially requiring many workers to carry out operations, is now replaced by the use of technological machines.

According to the German Chancellor, Angela Merkel, in 2014, she stated the meaning of industrial revolution 4.0 as a comprehensive transformation of all aspects of production that occur in the industrial world through the combination of digital technology and the internet with conventional industry.

How does digitalization affect manufacturing?

Digital transformation has changed the way factories work and the production process as a whole. The following are some of the positive impacts of digitalization in the industry:

1. Production Process Automation

Automation has become a key element in the industrial revolution 4.0. Through the use of robotics and automated control systems, many factory tasks that were previously performed manually can now be performed quickly and efficiently. This increases productivity, reduces human error, and improves workplace safety.

2. More Advanced Data Analysis

In the era of industrial revolution 4.0, companies have access to large amounts of data. Advanced data analysis technology enables companies to collect, process and analyze data more effectively. This helps companies make better decisions based on accurate insights from their data.

Significant Changes in Production

Digital transformation in industry has also changed the way production is carried out. Below are some of the significant changes that occurred in production:

1. Increased Efficiency

Digitalization allows companies to increase their production efficiency through automation, robotics and system integration. By using this technology, companies can reduce production time, minimize human errors, and optimize resource use.

2. Mass Personalization

Digitalization has allowed companies to personalize mass production. By using data and smart technology, companies can identify individual preferences and produce goods tailored to customer needs and desires.

What were the positive effects of the 4th industrial revolution?

The industrial revolution 4.0 brings many opportunities and challenges for companies in the factory and production industry. Here are some of them:

1. Innovation Opportunities

The industrial revolution 4.0 opens up opportunities for companies to develop new innovations in production. Technologies such as IoT, big data and artificial intelligence provide opportunities to create more efficient, intelligent and high-quality products and processes.

2. Cyber Security Challenges

As production systems become increasingly integrated with digital technology, cyber security becomes an important issue. Companies must protect their infrastructure from cyber attacks and threats that can damage production processes and expose sensitive data.

What is Digital Transformation for Manufacturing?

What is Digital Transformation for Manufacturing?
Digital Transformation

Production efficiency is a key factor in the manufacturing industry because it focuses on the optimal use of resources, time and labor to produce low-cost, high-quality products with shorter production times so as to achieve significant competitive advantages.

Of course, to support this, an effective and comprehensive Procurement Strategy approach is needed in procuring raw materials, spare parts and other resources. How to ensure timely, quality and economical supply by choosing reliable and trusted suppliers to minimize risks.

Digital transformation has become a buzzword in the manufacturing industry today. Changes in technology and the way consumers interact with products make digital transformation critical for manufacturing. In this article, we will discuss digital transformation for manufacturing and how it can help increase efficiency and productivity in the production process.

Digital transformation for manufacturing refers to the use of digital technology to increase efficiency and productivity in production processes. In a manufacturing environment, this includes the use of technologies such as robotics, analytics, and IoT to monitor and control production processes in real-time. 

Digital transformation also enables manufacturers to be more responsive to changing market demands, thereby enabling companies to make faster and more timely business decisions.

Why is Digital Transformation Important for Manufacturing?

Digital transformation is very important for manufacturing as it helps increase efficiency and productivity. In production processes that are complex and involve many variables, digital technology can monitor and control the process in real-time, quickly identify problems and solutions, and optimize overall production operations. This can reduce production time, production costs, and the amount of waste generated, thereby increasing the company's profit margin.

Apart from that, digital transformation also allows manufacturers to improve the quality of their products. By monitoring and controlling production processes in real-time, manufacturers can identify and fix problems quickly, reducing the number of defective products and increasing customer satisfaction.

How can Manufacturing Undertake Digital Transformation?

Manufacturers can undertake digital transformation by adopting technology that allows them to monitor and control production processes in real-time. Some technologies that are useful in digital transformation for manufacturing include:

  • Internet of Things (IoT): This technology allows manufacturers to connect their equipment and systems to the internet, enabling them to monitor and control production processes in real-time.
  • Robotics: This technology can help manufacturers to automate some production processes, increasing efficiency and productivity.
  • Analytics: This technology allows manufacturers to analyze data and identify problems and solutions quickly.
  • Cloud computing: This technology allows manufacturers to store and access their production data easily, enabling them to make faster and more timely decisions.

In carrying out digital transformation, manufacturers also need to ensure that their employees have the skills and knowledge needed to work with digital technology. Employee training and development can help ensure that manufacturers can maximize the potential of digital technology and achieve desired results.

What are Effective Procurement Strategy?

How can manufacturing companies that produce products using complex processes ensure that the supply of raw materials, spare parts and other production support needs is available on time, according to quality standards, and that the costs incurred are in accordance with the company's allocation of costs?

After the company analyzes production needs and makes detailed plans, it will then identify raw materials for spare parts and the needs and services needed to support the production process where the procurement department will usually negotiate contracts with several suppliers to get competitive prices.

In supply management, companies use an adaptive approach. If demand fluctuates, they have the right to adjust purchasing quantities and supplier diversification strategies so as to avoid dependence on one supplier which can pose supply risks.

In other words, an effective procurement strategy is not only about managing procurement and ensuring smooth production, but also ensuring that the entire process from start to meeting all requirements is as efficient as possible, has minimal risks and lower costs.

In the manufacturing industry, several important procurement needs include:

  1. Raw material. Primary needs in production, including raw materials such as metal, plastic, paper, or chemicals used in making the final product.
  2. Spare Parts and Components. The components that make up the final product, such as electronic, mechanical, or structural parts that require replacement or repair.
  3. Equipment and Machinery. Production machines, manufacturing equipment and work tools required to facilitate the production process and maintain production facilities.
  4. Service. Production support services such as machine maintenance, repairs, training and technical consultations to maintain smooth operations.
  5. Packaging and Supplementary Materials. Materials used to package the final product safely and attractively, as well as additional materials such as labels, information cards and instructions.
  6. Energy and Utilities. Energy supplies such as electricity, gas and water needed to run production facilities and ensure smooth operations.
  7. Technology and Software. Production technology includes the software necessary to control production processes, plan inventory, and manage operations.
  8. Transportation and Logistics. Transportation and logistics services to send raw materials, spare parts and final products from one point to another.
  9. Chemical material. Additional materials such as lubricants, additives, or other chemicals used in the production process.
  10. Security and Protection Equipment. Safety equipment, environmental protection, and protective equipment required in manufacturing operations.


Digital transformation has become a necessity for manufacturers to be able to compete in the digital era. By adopting technologies such as IoT, robotics, analytics, and cloud computing, manufacturers can improve their efficiency, productivity, and product quality. 

It is important for manufacturers to ensure that their employees have the necessary skills and knowledge to work with these digital technologies, so as to maximize the potential of the technology and achieve the desired results.

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